When can I offer a Compromise Agreement?
Employers often wish to offer a compromise agreement, during the initial stages, and even before the beginning of the capability/ disciplinary or redundancy procedure.
An early offer of a compromise agreement has the advantage of the management saving time of attending meetings. The employee having the certainty of an ex gratia payment will probably be less disruptive to their co-workers. Both parties have the benefit of certainty at an early stage. However, there is case law to suggest that such action is tantamount to constructive dismissal and would allow for the employee to argue for unfair dismissal compensation. This could mean that the compromise package would have to be greatly increased so as to avoid the matter being resolved at the employment tribunal.
The safest route is to seek legal advice, to manage the employee through the procedure and only at the correct time to offer a compromise agreement.
There are always strategic considerations in relation to timing. If a compromise agreement is offered immediately the employee may think that the employer's legal position is weak and that in time there will be a larger offer.
Clearly, the decision as to when to make an offer should be carefully considered, so that it is at the time the employee is most likely to accept but not at a time which would open you up to having to increase the compromise package.
For more detailed advice tailored to your needs please call Andre or Ruth both specialist employment partners at Stone Joseph on 0207 8549098.